Market Wrap for March 17th-23rd 2018

Market Wrap for March 17th-23rd 2018

Global markets all suffered this week as political and monetary policy actions weighed heavily on investors. The Dow dropped 5.67% this week, ending at 23,533.20, while the S&P 500 tumbled 5.95%, to finish at 2,588.26. Tech stocks were at the forefront of the decline due to increased scrutiny of Facebook’s role in the burgeoning Cambridge Analytica scandal, resulting in weekly losses for both benchmarks that were the sharpest since January 2016.

Key highlights:

-Donald Trump escalated a potential trade war with China by announcing a tariff worth $50 billion, alleging widespread intellectual property theft. China has responded with tariffs of its own, and communicated their ability to retaliate more heavily should Trump pursue additional trade barriers. Additional turmoil was caused by the recent announcement of the firing of H. R. McMaster in the role of National Security Adviser, and his replacement with war-hawk John Bolton.

- Jerome Powell, Chairman of the Federal Reserve, announced a modest rate hike of 0.25%, to 1.5-1.75%. In a subsequent press conference, Mr. Powell indicated that there will likely be two additional rate hikes by the end of 2018.